Title
Discuss the Proposed Waiver of Roadway Impact Fees as a Targeted Incentive to Promote Economic Development/Redevelopment in McKinney's Town Center (Kevin Spath) (20 minutes)
Summary
MEETING DATE: November 1, 2011
DEPARTMENT: Development Services - Planning Department
CONTACT: Kevin Spath, AICP, Assistant Director of Planning
RECOMMENDED CITY COUNCIL ACTION:
· Discuss and provide feedback
ITEM SUMMARY:
· At the September 26th work session, Staff and the consultant team presented to City Council an update on the status of the creation of a coordinated Business Plan for McKinney's Town Center. The presentation specifically included a discussion about the policy issue of roadway impact fees as a monetary disincentive to infill redevelopment in the Town Center.
· The presentation also included a discussion about the City's possible creation of a targeted incentive to promote economic development/redevelopment in the Town Center through the reduction/waiver of roadway impact fees. The City Council indicated general support of the idea.
· Discussion on this topic continued at the October 4th regular meeting during City Council's consideration of the appeal of roadway impact fees requested by Louisiana Street Grill.
· Based on feedback received during the September 26th work session and the October 4th regular meeting, Staff is now providing additional information to:
· demonstrate the relationship between roadway impact fee revenue and the funding of roadway improvement projects within the City's Capital Improvement Program (CIP) between FY 2008 and FY 2011, and
· demonstrate the City's "return on investment" when comparing roadway impact fee revenue and ad valorem tax revenue for 2 case studies in McKinney's Town Center.
· Staff is also recommending moving forward with the following approach for creating a targeted incentive specifically regarding the waiver of roadway impact fees in McKinney's Town Center:
· Staff proposes to expand the current Neighborhood Empowerment Zone (NEZ) program to apply to commercial, industrial, community facility, multi-family, and mixed-use developments (currently, the NEZ program only applies to single-family development).
· Staff proposes to maintain the current NEZ boundary, which already matches the overall geography of the McKinney Town Center area.
· Staff proposes that the City offer a 100% waiver of roadway impact fees for commercial, industrial, community facility, multi-family, and mixed-use developments (up to $49,999 per project).
· Staff proposes that City Council approval be required for waiver requests in the amount of $50,000 and above.
· Based on City Council feedback and direction at this work session, Staff will proceed with drafting an amendment to the current NEZ ordinance for consideration and possible action at the November 15th regular meeting.
BACKGROUND on the NEIGHBORHOOD EMPOWERMENT ZONE:
· The current Neighborhood Empowerment Zone (NEZ) was created by City Council in 2007 as a geographically coexistent companion to the Historic Neighborhood Improvement Zone (HNIZ) (Sections 98-83, 98-84 and 98-85 of the City of McKinney Code of Ordinances).
· Under Texas Local Government Code Chapter 378, a municipality can utilize a Neighborhood Empowerment Zone to waive fees related to the construction of buildings in the zone (including fees related to the inspection of buildings and impact fees) in order to promote the creation and rehabilitation of affordable housing as well as an increase in economic development in the zone.
· Currently in the NEZ, impact fees are waived only for new single-family construction projects.
BACKGROUND on IMPACT FEES:
· Roadway impact fees are imposed by the City on all "New Development" in order to generate revenue for funding or recouping the capital costs of roadway system improvements for each service area, which are necessitated by the new development in that service area for a period not to exceed 10 years.
· New Development is defined as any project "involving the subdivision of land and/or the construction, reconstruction, redevelopment, conversion, structural alteration, relocation, or enlargement of any structure, or any use or extension of the use of land which has the effect of increasing the requirements for capital improvements, measured by an increase in the number of service units (vehicle miles) to be generated by such activity, and which requires either the approval and filing with Collin County of a plat pursuant to the City's subdivision ordinance or the issuance of a building permit."